Legal

July 18, 2025 Published by North Alberta Chapter - By Michael Gibson

Tick Tock Goes the Limitations Clock

What Condo Boards Need to Know About Condo Fees and Alberta’s Limitations Act

Condominium contributions don’t enforce themselves. Boards must act within two years or risk losing out entirely, even if a caveat is on title. Learn why understanding statutory limitations is critical to fulfilling your board’s financial duties.

One of the primary responsibilities of any condominium board is setting an annual budget and levying condominium fees on all unit owners to fund common expenses. These fees, along with any special assessments (extra contributions required for specific projects or deficits), are legally referred to under Alberta’s Condominium Property Act (CPA) as contributions.

Boards are also responsible for collecting any unpaid contributions from unit owners. To help enforce this responsibility, the CPA gives condominium corporations the right to register a caveat (a legal notice) against the title of a delinquent unit owner’s property. This caveat can serve as a powerful enforcement tool, but only if used correctly and within a limited time.

What Exactly is a Caveat?

Understanding Your Legal Tool for Enforcing Collection

A caveat is a legal notice registered on a property title that signals to anyone reviewing the title (such as buyers or lenders) that a third party—here, the condo corporation—has an interest in that property. In the case of unpaid condo fees, a caveat under the CPA asserts the corporation’s legal right to collect money owed.

Importantly, this right is enforceable in the same way as a mortgage, meaning that the condo corporation can initiate a foreclosure action to force the sale of the unit and recover outstanding contributions through the sale proceeds.

However, a common misconception among boards is that filing a caveat is enough. Many simply leave caveats on title for years, hoping to collect both the unpaid fees and accumulated interest once the unit is sold. But this strategy often backfires.

The Time Limit Trap: Why Delay Can Cost You

This is where statutory limitations come into play. In Alberta, the Limitations Act sets strict deadlines for when a legal claim can be enforced in court. Specifically, it gives plaintiffs two years from the date they first knew (or ought to have known) about the issue to file a lawsuit.

Failing to take legal action within this window means the defendant (in this case, the delinquent unit owner) becomes immune to the claim, no matter how valid it originally was. In other words, if you don’t sue within two years, your legal right to collect is gone.

Every Canadian province has some form of limitation period.

The policy behind it is to:

• Ensure fairness by encouraging timely dispute resolution;
• Prevent unfair surprise lawsuits long after the fact;
• Preserve the integrity of evidence (memories fade, records are lost);
• Avoid clogging the court system with stale claims.

The message is simple: the courts expect people to protect their own interests. If a plaintiff doesn’t act within the time limit, they are presumed not to care enough, and the court won’t step in to help.

How the Clock Ticks for Condo Fee Arrears

For condominiums, the plaintiff is the condo corporation, and the “injury” is the failure of a unit owner to pay required contributions. Condo fees are usually monthly, creating what the law considers a recurring or periodic obligation.

Under the Limitations Act:

• A new two-year clock starts ticking each time a fee or assessment becomes due and isn’t paid.
• You can only sue to collect amounts that became due within the past two years.
• Older arrears—those more than two years past due—are statute-barred and legally uncollectable, unless a lawsuit was filed before the deadline.

Crucially, a caveat does not stop or extend this limitation period. Even if the caveat is still registered on title, the claim it represents may be legally dead if a court action wasn’t started in time. Once that happens, the caveat no longer meets the requirements of the CPA and becomes invalid.

Stay Ahead: How to Prevent Lost Contributions

So what can boards do?

First, remember: a registered caveat is not a substitute for legal action. It’s a tool that supports enforcement, but only if the claim it relates to is still valid.

Action Steps for Condo Boards:

• Monitor delinquent accounts closely. Keep a calendar or alert system for when contributions go unpaid.
• Don’t wait too long. If an amount owing is approaching the two-year mark, prepare to file a claim in court.
• Foreclosure is a last resort, but filing a lawsuit—whether to enforce a caveat or begin foreclosure—is the only way to preserve the condo’s legal right to collect.
• Consult legal counsel to review your ledgers and caveats regularly.

As a rule of thumb, if any arrears are close to two years old, act now.

Failing to do so not only weakens your claim, but it may also be a breach of your board’s statutory duty to collect contributions on behalf of all owners.

Final Thoughts: Protecting the Collective Purse

Limitations laws are meant to ensure fairness and efficiency in the legal system, but they can surprise boards that aren’t watching the calendar. Unpaid condo fees are not collectible forever, and relying on a caveat alone may leave your corporation short.

By taking timely, informed action and understanding the legal tools available under the CPA and Limitations Act, boards can fulfill their duties, preserve their corporation’s financial health, and avoid letting delinquent owners off the hook at everyone else’s expense.

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Michael Gibson is a lawyer at Miller Thomson LLP and is one of the authors of the textbook on condominium law in Alberta. He has extensive experience in condominium law, advising developers, corporations, boards, managers, and owners.